Most sellers start Amazon PPC by turning on an automatic campaign, watching the spend climb, and hoping something sticks. A few weeks later the ad bill is real, the sales are patchy, and nobody can say whether the ads are actually making money.
I have managed Amazon accounts since 2015, and IG PPC now runs paid search for 7 to 9 figure brands, work that put us on the 2025 Inc. 5000. The sellers who win with PPC treat it as a system with a clear objective, rather than a switch you flip and forget.
The guide below walks the whole system in order: what the ad types are, how the auction works, how to structure and target campaigns, how to bid, and how to read the metrics that tell you it is working. Follow it top to bottom and you will know how to do Amazon PPC on purpose.
TL;DR — the short version
Amazon PPC (pay-per-click) is advertising where you pay only when a shopper clicks your ad. To do it well, pick the right ad type, structure your campaigns around one objective, research keywords from Amazon’s own data, bid to win the placements that convert, cut wasted spend with negatives, and judge the results on profit and TACoS rather than raw sales.
Understand What Amazon PPC Does
Amazon PPC is the paid search system inside Amazon, where your ads appear in search results and on product pages and you pay per click. According to Amazon Ads, you set a bid for how much a click is worth to you and a daily budget that caps a campaign’s spend, so there is no flat fee and no monthly minimum from Amazon itself.
Two jobs make PPC worth running. The first is sales you would not otherwise get, from shoppers who never scrolled to your organic listing. The second is ranking: paid clicks and orders feed Amazon the sales velocity that lifts your organic position over time.
Here is the honest limit. PPC drives relevant traffic, but it cannot make a shopper buy a product they do not want, so a weak listing or a poor main image will bleed money no matter how good the ads are. Fix the listing first, then scale the ads.
Choose the Right Amazon Ad Type
Amazon gives you three self-service ad types, and most sellers should master the first before touching the others.
Sponsored Products
Sponsored Products promote a single listing in search results and on product pages, and they are where almost every seller should start. They carry the highest intent, are the simplest to set up, and give you the search-term data that powers everything else.
Sponsored Brands
Sponsored Brands show your logo, a custom headline, and several products in a banner at the top of search. They suit brand-registered sellers with a catalog to show off, and they work best once your Sponsored Products campaigns are already profitable. Our breakdown of Sponsored Products versus Sponsored Brands covers when each one earns its place.
Sponsored Display
Sponsored Display reaches shoppers on and off Amazon, including people who viewed your product but did not buy. Treat it as a retargeting and defense layer once your search ads are humming, rather than a starting point.
Understand How the Amazon PPC Auction Works
Every ad slot on Amazon is sold through an auction that runs the instant a shopper searches. You enter a bid, Amazon weighs it against relevance and your competitors, and the winners fill the ad placements.
Amazon runs a second-price auction, so you do not automatically pay your full bid. You pay just enough to beat the next-highest advertiser, up to your maximum, which means a well-targeted ad on a converting listing can win placements without overpaying.
Competition sets the price. When many sellers chase the same keyword, the cost to win a click climbs, which is why the same click can cost a few cents in one niche and several dollars in another.
Build a Simple Campaign Structure First
Structure is where most accounts go wrong, usually by mixing every keyword and match type into one campaign so the data is impossible to read. Keep it clean from day one, and read our deeper guide on how to structure your PPC campaigns when you are ready to scale.
Automatic Campaigns
An automatic campaign lets Amazon choose which searches to show your ad on, based on your listing. Amazon’s own best-practice guidance is to start here, because an auto campaign is real-world keyword research: it surfaces the terms shoppers actually use to find products like yours.
Manual Campaigns
A manual campaign is one where you pick the exact keywords and product targets. Once an auto campaign proves which terms convert, you harvest those winners into a manual campaign, where you control the bids and scale the profit.
The Three Match Types
Manual keyword targeting has three match types, and each controls how loosely Amazon matches your keyword to a shopper’s search:
- ●Broad match: your ad can show for related searches, including synonyms and word variations. Good for discovery, looser on relevance.
- ●Phrase match: the shopper’s search must contain your keyword phrase in order. A middle ground between reach and control.
- ●Exact match: your ad shows only for that exact term and close variants. The tightest control, and where you scale proven, profitable keywords.
Do Keyword Research With First-Party Amazon Data
Most guides tell you to run a keyword tool and bid on whatever it spits out. My preference is to start with Amazon’s own data, because it shows what is really converting in your category rather than an estimate.
Amazon Brand Analytics and Search Query Performance show the terms driving clicks and sales to products like yours. A simple relevance test: in Brand Analytics, look at the top three click-share products for a keyword, and if at least two of them are similar to yours, the keyword is worth targeting.
Build your first manual campaigns from those proven terms, then keep mining your search-term report for new winners. Our guide to keyword research for Amazon ads walks the full method.
Set Bids to Win the Placements That Convert
Start every keyword within Amazon’s suggested-bid range, then adjust based on where it converts. Bidding too low wins no impressions, and bidding blindly high burns margin.
The lever most sellers ignore is placement. According to Amazon Ads, you can raise your bid for specific placements, and paying an extra 20 to 30% for the top of search placement is often worth it because that slot converts far better than the rest of the page. On a launch ranking campaign, we will push that premium higher to win the position outright.
Bid on the data rather than on emotion. Raise bids where a keyword converts under your target and cut them where it runs over, and let a week or two of results guide each move rather than reacting to a single day.
Cut Wasted Spend With Negative Keywords
Negative keywords stop your ad from showing on searches that spend without selling, and they are the fastest way to lower a bloated ad bill. Every account leaks money on irrelevant terms until you plug them.
Read your search-term report every week and look for queries with clicks but no sales, or terms that clearly do not match your product. Add those as negatives so the budget flows to keywords that convert. Our walkthrough on how to find negative keywords with low click or sales data shows exactly where to look.
Be deliberate. A term with ten clicks and no sales is a candidate to cut, while one with a single click needs more data before you judge it.
Launch a New Product With a Ranking Campaign
A new product needs velocity, the volume of clicks and orders that tells Amazon your listing deserves a higher organic rank. A high conversion rate alone will not rank you if the sales volume is too thin to register on a competitive keyword.
For a launch, build a ranking campaign on exact-match keywords you most want to rank for, and bid aggressively to hold the top of search. Run manual broad, phrase, and exact campaigns alongside it for expansion, plus a targeting campaign aimed at your main competitors’ product pages. Price the product to convert while you do this, because the honeymoon period rewards early momentum.
Ease off once organic sales carry the listing. A good rule of thumb is that when roughly half your sales come from organic traffic, you can start pulling paid spend back.
Read the Metrics That Show Real Profit
The number most sellers obsess over is ACoS, and on its own it is the wrong target. A low ACoS (advertising cost of sales) can hide a shrinking business, and a higher one can fund the ranking that grows it.
Here is how the core metrics compare, and which decision each one should drive:
| Metric | What It Measures | Use It To |
|---|---|---|
| ACoS | Ad spend as a percent of ad sales | Judge the efficiency of a single campaign or keyword |
| TACoS | Ad spend as a percent of total sales | Judge whether ads are growing the whole business |
| ROAS | Ad sales divided by ad spend | Read return the inverse way to ACoS, common with agencies |
| CPC | Average cost per click | Track what you pay to win traffic |
| CVR | Orders divided by clicks | See whether the listing converts the traffic you buy |
The metric that reframes everything is TACoS (total advertising cost of sales), which measures ad spend against your total revenue. When TACoS falls while sales grow, your organic rank is improving and ads are doing their real job. Judge campaigns on profit and TACoS, and read what a good ACoS looks like as one input rather than the scoreboard.
Optimize Your Campaigns Every Week
PPC is never finished. The accounts that win get a short, disciplined review every week rather than a big cleanup every quarter.
A weekly routine covers the essentials:
- ●Harvest winners: move converting search terms from auto and broad campaigns into exact match.
- ●Prune waste: add negatives for terms that spend without selling.
- ●Adjust bids: raise where a keyword beats your target, cut where it misses.
- ●Scale gradually: grow budgets on winners in steps, since doubling overnight can wreck performance.
- ●Protect margin: watch conversion rate and pause products that bleed for 30 days or more.
Our full Amazon PPC optimization process lays out the whole weekly cadence in detail.
Decide Whether to Self-Manage or Hire an Agency
You can absolutely run Amazon PPC yourself, especially early on when the catalog is small and you have time to learn. The work is a weekly commitment: search-term reports, bid adjustments, negatives, and structure, done consistently.
The math changes as you scale. Once spend runs into five or six figures a month, small inefficiencies cost real money, and an experienced team usually pays for itself. In the accounts we manage, clients often see figures like these, though results vary by category and starting point.
If you would rather have specialists own the strategy, our hands-on Amazon PPC management team optimizes weekly and judges its work on your bottom line. One brand we worked with went from a monthly revenue of $32,000 at a 34% ACoS to $82,000 at a 19% ACoS in 60 days, with TACoS down from 12% to 7% and the product ranking on page one. Those are client-reported figures, and every account is different.
Frequently Asked Questions (FAQs)
Conclusion
Doing Amazon PPC well is not about a secret setting. The work is a sequence: understand the ad types, keep your structure clean, target with first-party data, bid to win the placements that convert, cut waste with negatives, and judge everything on profit and TACoS.
Work that sequence every week and the ads stop being a mystery expense and start being a lever you control. The sellers who profit are the ones who give PPC an objective and a routine, then let the data guide every bid.
If you would rather have a team run it for profit, get a free Amazon PPC audit and we will show you where your spend is leaking and what to do about it.
About the author: Isaac Gross is the founder and CEO of IG PPC, a hands-on Amazon and Walmart PPC agency for 7 to 9 figure brands. An Amazon seller since 2015, he founded IG PPC in 2019, and the firm now manages billions in annual Amazon sales.
